Credit card rewards–plus customer satisfaction

Credit card rewards–airline miles

Among those who write about credit cards, travel reward programs are not currently flavor of the month. There are too many stories of consumers whose reward points have been suddenly devalued, or who have experienced real difficulty redeeming points on the routes and at the times they want. Many financial advice columnists point people toward cash-back cards instead.

That’s not to say travel rewards programs are a bad idea for everyone. If your lifestyle is one for which miles make sense, then by all means find the credit card rewards program that suits you best. But don’t become so obsessed by the number you’ve acquired that you avoid making a level-headed assessment of the value that you’re actually receiving.

Bonus miles

Most airlines are now inviting you to top off your bank of miles by buying more. However, The Wall Street Journal reported Friday that many of the deals on offer make little financial sense. Consumers typically buy these at about three cents a mile, and then use them to buy tickets at a redemption value of roughly half that. Not great economics.

The Journal did find examples where top-off purchase programs could deliver serious savings, but cautioned that these were relatively rare. The message? As always with deals from credit card companies and airlines, be sure to read the fine print and calculate the costs and benefits before you commit yourself.

Credit card companies–the best of the best?

Speaking of credit card companies, it’s clear that some are better than others. But which are the good ones? Well, we may have moved closer to a more definitive answer when J.D. Power and Associates unveiled its 2010 U.S. Credit Card Satisfaction Survey on Friday.

More than 8,500 credit card users responded to the survey, and the top companies scored particularly highly on:

• Credit card rewards programs
• Customer experiences when interacting with companies’ online services and call centers
• Swift and effective problem resolution

Those credit card users scored American Express best for the fourth consecutive year, giving it a total mark of 769 out of a possible thousand. Discover Card came in a close second with 757.

American Express

American Express has a broad range of credit cards and charge cards for both consumers and businesses. Blue Sky from American Express®, for example, is one of those travel rewards cards that doesn’t tie you to a particular airline, and that therefore avoids many of the issues described above. You get a point for every dollar spent, and then redeem them at a rate of 7,500 points for each $100 of travel purchases.

Meanwhile, the classic American Express® Preferred Rewards Gold Card offers generous benefits including some interesting introductory bonuses. These include 10,000 points when you spend $500 within the first three months of membership, and the waiving of the first year’s annual fee.

Discover More

The Discover® More® Card – Black is one of the best balance transfer credit cards around. It offers an introductory zero percent APR on these for 12 months, which has to be a serious bargain.